Kickstarter legally forces itself to give back to humanity

Kickstarter is now forced/willing to give back to society because they are reincorporating to become a “public benefit corporation” (PBC). That basically means the company will make profits while also benefiting society.

The actual laws on PBC are quite confusing and different in every state. However, Kickstarter plans on registering in Delaware where PBC state laws came into effect two years ago. They have also been a voluntary B-corp (benefit corporation) since last year, but decided to become a Delaware PBC to turn their personal pledge of giving back into state law.

With the change comes new rules.

– “Kickstarter will never sell user data to third parties”

– “Kickstarter will not use loopholes or other esoteric but legal tax management to reduce its tax burden”

– “Kickstarter will … invest in green infrastructure, support green commuting methods, and factor environmental impact when choosing vendors.”

They even say they will give large amounts of money to others. Kicksterter says they will “annually donate 5 percent of its after-tax profit”. The 5% will be split into two halves, 2.5% going towards music programs for children and young adults, primarily focusing on undeserved communities in New York City. The other 2.5% going towards “organizations fighting to end prejudices against and increase opportunities for people of color, women, and LGBTQ individuals”.

Kickstarter is one of the few profitable startups. Making the move to PBC makes sure they can’t slip up on their word. The founders also say they never plan on becoming incorporated. Kickstarter co-founder and CEO Yancey Stickler tells The New York Times,

“That would push the company to make choices that we don’t think are in the best interest of the company.”

February 2017, is when the first PBC statement will arrive. The statement will go over if and how the company has reached it’s laid out charter.

Source: Kickstarter

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